Todd Dunn’s innovation team works to improve Advocate Health’s business model — but it doesn’t keep the spotlight to itself.
Instead, Dunn and his colleagues teach leaders inside other business units how they can participate in the innovation process through a program called the Impact Academy. Drawing on theories from well-regarded innovation thinkers like Rita McGrath, Steve Blank, Alex Osterwalder, and the late Clay Christensen, Dunn and his team work with other leaders to take on the organization’s most pressing challenges together.
Dunn serves as the VP of Enterprise Innovation for the $28 billion healthcare system, which was formed when Advocate Aurora Health and Atrium Health merged in December 2022. Advocate Health is based in Charlotte, North Carolina. Its care delivery brands are Atrium Health (based in Charlotte), Advocate Health Care (based in the Chicago suburbs), and Aurora Health Care (based in Milwaukee, Wisconsin).
As part of our new research report, Building a Productive Portfolio, we interviewed Dunn about his approach to setting up a scalable system for innovation; looping in business units; and success metrics.
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The job and approach. My main responsibility is to instill an innovation system for the company, from leadership capabilities and competencies all the way to projects that we work on. We focus on innovation in two ways: business model innovation and efficiency innovation… My team is super deep is on the business model innovation side. I report to the Chief Innovation and Commercialization Officer of the organization.
We have two ways we attack [innovation]. We go an inch deep and a mile wide, and the way that we do that is through a program that we’ve created called the Impact Academy. It is a cohort setup, where we bring high-potential leaders [from business units] in, and we teach them business model innovation through them bringing a problem — so it’s not didactic, it’s really experiential learning. We also think about [innovation] as an inch wide and a mile deep, where we go really deep on a project being led by a well-defined problem oropportunity in the business model.
Pursuing Business Model Innovation. We relentlessly focus on what the consumer cares about [and] what the company cares about, not what the innovation team cares about. You’ll often hear innovation teams talk about the number of ideas, or the number of startups that they’ve spoken with, or the number of this or the number of that. I think that’s an ingredient. I do not believe that it is the measure of our value back to the corporation; I believe someone else gets to determine whether or not we’re valuable. And the only way for us to do that is to have a system that tunes itself to those measures. That’s our system that we call Design for Impact. [It’s] a very structured system of business model innovation, that goes from the continuum of deep problem definition and consumer understanding, to business model innovation, to implementation.
Our team internally is called the innovation engine. And we are all really deep in Clay Christensen and his colleagues’ theory called the Jobs to Be Done theory. We use that theory… to articulate our understanding of the progress that people want to make. We also try to look at the struggles that the business has. We use tools from Alex Osterwalder — his business model canvas, and the value proposition canvas. What that allows us to do is have a structured way of talking about a consumer — of doing the interviews, of unpacking the observations and the interviews, and then to document the assumptions in the business model and to drive the experiments. … Design for Impact [tries] to put that into a system that creates a standard language, tools and methods that we can all agree on. … We didn’t create anything from a theory perspective that’s new, or from a tool perspective that’s new. We have a system that we could go teach anybody in the corporation, whether it’s through the Impact Academy, or whether it’s through a project.
…If this project went perfectly for you, what would you love to have the outcome be?
Customer-centricity and success metrics. There’s a term that I use called the love metric — if this project went perfectly for you, what would you love to have the outcome be? [If] a nurse [needs] reduced documentation time for dialysis, we have to focus on that. If it’s for the operator, I need to reduce the cost per treatment — that’s the measure. … We work very hard very early to find out what is the customer benefit metric that we are attacking through the effort. That’s what we believe our remit is. From a corporate perspective, one can always think about better quality at a lower cost and doing it more efficiently. Those are very high-level measures; we try not to get lost there … but we deeply immerse ourselves in the world of the people in their context. … [We] try to hit key customer benefit metrics through the project because we believe that by doing that, it will always produce the outcomes and the impact that the corporation is seeking for us to deliver.
Overcoming obstacles. Time is always such an obstacle, because so much is going on in healthcare — there’s so many cost pressures, and then labor pressures. The way to mitigate that is to see innovation as the way to renovate your current business models and to create new ones versus this “thing” that’s [off to the side]. That’s really why we wanted to build a system [for innovation] — so that people would see the system as supporting better outcomes for the consumer and the company. To leaders, I would say, instantiate an innovation system. See it as a necessary capability and competency to renovate your current business models and to create new ones, just as legitimate as finance, marketing, clinical ops, because innovation in and of itself is really about renewal. It’s about doing things better — not one offs, but systematically doing it right.
